International observers today issued a scathing report on Russia's elections, describing yesterday's poll as "not fair" and highlighting numerous flaws including "unprecedented" abuse of office by president Vladimir Putin.

The Organisation for Security and Cooperation in Europe (OSCE) said Sunday's parliamentary elections had failed to meet the organisation's commitments and standards. "It was not a fair election," said Goran Lennmarker, the head of the OSCE's parliamentary assembly.

The observers said there were at least four areas of major concern. These included a "strong bias" in the media in favour of Putin and his United Russia party and "widespread" reports of harassment of Russia's opposition parties.

Putin's "unprecedented" personal endorsement for United Russia amounted to an "illegitimate merging of a political party and the state", and this was an "abuse of power" and a "clear violation of international commitments and standards", the report said.

The observers decried Kremlin rule changes ahead of Sunday's elections, which included raising the threshold for entering the state duma from 5 to 7%. This made it "extremely difficult for new and smaller parties to develop and compete effectively", it said.

"If Russia is a managed democracy, then this was a managed election," Luc van den Brande, the head of the Council of Europe's parliamentary assembly (PACE) remarked, adding that there was no real "separation of powers" in Russia.

He warned: "While we are happy that there was the fall of the (Berlin) Wall, we don't want to have a new dividing line in Europe in terms of democracy. There wasn't compliance with many Council of Europe standards."

Today's report is likely to prompt a swift and furious reaction from the Kremlin, which has already denounced the OSCE after its main observing organisation, the Office for Democratic Institutions and Human Rights (ODIHR), refused to monitor Sunday's poll, claiming Moscow had denied its experts visas.

This morning, supporters of Putin's United Russia party were celebrating victory after his party gained 64.1% of the vote. The communists came a distant second with about 11.5%, with the ultra-nationalist Liberal Democratic party taking 8.4%. A Just Russia, the opposition party that is regarded as a fake that was put together by the Kremlin to thwart competition, also got over the new 7% barrier.

Several hundred pro-Kremlin activists gathered in the snow outside the Kremlin and St Basil's cathedral this morning, next to a newly erected stage. On it were the words: "Our victory" beneath Putin's face. Patriotic rap music blared across a square decorated with red, white and blue balloons.

There are now serious doubts over Russia's continuing membership of the Council of Europe, which it joined in 1996. Today, however, Van Den Brande said there was no prospect of Russia being thrown out of the club despite Sunday's "not fair" election. "We are for inclusion and not exclusion," he said.

But there was disappointment from observers about the direction that post-communist Russia is taking after nearly eight years under Putin. The observers also complained about restrictions on their activities - with only 300 invited compared with the 1,163 who came during Russia's last parliamentary vote in 2003.

"I have been coming to your country for 20 years since the beginning of democracy," Lennmarker told a press conference today at Moscow's Savoy hotel. "It is a difficult road. There is an understanding that it can take time. I hoped this (election) would be a step forward. But I'm sad to say that is not so.

"The elections took place in an atmosphere which seriously limited political competition and with frequent abuses of administrative resources, media coverage strongly in favour of the ruling party, and an election code whose cumulative effect hindered political pluralism. There was not a level political playing field in Russia in 2007."

Putin, however, today hailed the vote as "legitimate" and said it had reaffirmed Russia's "internal political stability". Talking to workers just outside Moscow, he declared: "It is now clear to me that Russians will never allow their country to develop along the destructive path seen in some other countries of the former Soviet Union."

Yesterday's elections effectively wiped out the last independent MPs from Russia's new parliament. With the exception of the semi-autonomous Communists, all new MPs support the president with the pro-presidential United Russia taking 70% of the seats. None of Russia's western-orientated reform parties won a single seat.

"There are no illusions that what is being called elections was the most unfair and dirtiest in the whole history of modern Russia," said Gary Kasparov, the former chess champion and opposition leader. Police arrested him and hundreds of other opposition activists last week.

European Union governments today voiced concern over the conduct of Russia's elections. In Berlin, the German government spokesman, Thomas Steg, said "Russia was not a democracy and Russia is not a democracy".

One of the new MPs is Andrei Lugovoi, the former KGB spy wanted in London for the murder last year of the Russian dissident Alexander Litvinenko. Lugovoi was elected for the Liberal Democratic party after campaigning on an anti-British platform. His success in the election gives him immunity from prosecution.